Windfall barely nicks Bay Area transit deficit

TRANSIT

Published 4:00 am, Monday, February 22, 2010

The $70 million in federal funds that Bay Area transit agencies will split since the money was diverted from BART's Oakland Airport Connector won't stop service cuts or layoffs, solve budget problems or go very far toward filling vast deficits.

Rather than being a huge windfall, transit officials said, receiving the unexpected allotment of federal stimulus funds is more like a destitute person finding a $100 bill on the sidewalk.

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He expects most of the 19 transit agencies sharing the money will use it to fund maintenance programs, which will allow them to free up equivalent amounts of money in their budgets to help cover general operating expenses.

AC Transit, which will receive $6.7 million in federal stimulus funds, plans to use that strategy. But the agency is already cutting service by 8.5 percent, and it faces a $50 million deficit in the budget year that begins July 1.

"It's good to have the money, and it will help, but it won't change anything we've set in motion, like our March service cuts," said Clarence Johnson, a spokesman for AC Transit.

While it may not solve any transit agency's troubles, the $70 million comes as the Bay Area's transit operators are struggling because of the loss of all state funding, the steep decline in sales tax revenues and the drop in ridership and fare revenues.

The money, 20 percent of the Bay Area's stimulus funds for transit, had been allotted to the Oakland Airport Connector. But the Federal Transit Administration ruled last week that the transit agency had not conducted appropriate analyses on the effect of the new service on low-income and minority communities, and asked the Metropolitan Transportation Commission, the Bay Area's planning and financing agency, to reassign the funding.

The commission sent the money to a collection of transit agencies that had already split the other 80 percent of the stimulus funds, or $271 million.

The San Francisco Municipal Transportation Agency, which runs the region's busiest transit system, will benefit the most and receive about $17.5 million. Like most transit agencies, Muni expects to steer most of that money toward preventive maintenance, freeing up a like amount for its general budget.

"Clearly it helps," said Judson True, an agency spokesman, "and we're looking at the impact it may have on our current-year deficit."

But Muni's current-year deficit of about $17 million could grow larger, particularly if the agency does not raise $11.2 million from a controversial experimental taxi medallion program it has yet to launch, and fails to receive $7 million in sales tax funds it hopes to cajole out of the San Francisco County Transportation Authority.

And then there's the bigger picture: the expected $53 million deficit in the budget year that starts July 1. Rentschler noted that the $17 million would only cover three to four months of the deficit - and only once.

"If you believe (the Airport Connector money) will solve things, you're wrong," Rentschler said. "At best, it could delay it for a few months."

BART will also receive nearly $17 million. But according to Luna Salaver, a spokeswoman, it plans to use the funds for rail car and track improvements - not to offset the current-year deficit, which could require a small number of layoffs.

"It will help make our service more efficient and comfortable," she said, "But we still need to find solutions to our budget problems."

As for the $492 million Oakland Airport Connector, a project that has been planned for at least 20 years, BART is not giving up - despite the loss of the $70 million and the possibility it could forfeit another $105 million in federal funds.

"We're still looking at our options for financing and technology," Salaver said. "We are not pronouncing it dead."